"Sam" <sam_biller[at]raytheon.com> wrote:

- quote -

File the 982. The elections are for reducing tax attributes
that likely don't apply to her. The non-taxability of debt
discharge due to insolvency is a matter of statutory law not
of taxpayer election.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

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My girlfriend recently received a notification from the IRS
that she owes approximately $1,600 since she did not report
a discharge of a credit card debt in 2002. The discharge was
due to her divorce in 2001. She never received a 1099-C from
the creditor (possibly due to a change in address).

Reviewing the information on this subject, I've found that
she should have filed a Form 982 with her 2002 taxes since
she was insolvent at the time. The instructions on Form 982
indicate, "If you timely filed your tax return without
making the election, you can still make the election by
filing an amended return within 6 months of the due date of
the return..."

Since it is now 2+ years since the due date of the return,
how should she proceed?

Can she still file a 1040x with a Form 982 even though it is longer
than 6 months?

TIA,
Sam

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